BlogLatest NewsBusinesses lose hundreds of millions of pounds to fraud every year, study reveals

Businesses lose hundreds of millions of pounds to fraud every year, study reveals

Businesses lose hundreds of millions of pounds to fraud every year, study reveals

Businesses have lost hundreds of millions of pounds to Payment Diversion Fraud (PDF) in the last 12 months, a major study has revealed.

The research, published by the National Economic Crime Centre (NECC), suggests that remote working and cybersecurity vulnerabilities are leading to a spike in reported crimes.

PDF – also known as Business Email Compromise – involves a fraudster impersonating others, creating or amending invoices, and diverting payments to bank accounts under their control.

According to the latest statistics, more than 4,600 cases of PDF were reported to Action Fraud in the year to September 2021.

With the average loss amounting to £30,000, it means that over £138 million has been lost to this type of crime in the last 12 months.

The NECC warned that businesses are most vulnerable to PDF in March and November when firms typically complete their year-end accounting.

“Payment diversion fraud is increasing and it is vital that people are alive to the threat. Small and medium sized businesses are most at risk due to less comprehensive IT security, but these criminals will also target home-buyers due to the scale of the transactions,” said Jon Shilland, fraud threat lead at the NECC.

“Whenever you are making a payment to a supplier, or to your solicitor in the case of a house purchase, you should be highly suspicious of any change in account details or new instructions. Always check with a trusted known contact, and if you have any doubt do not transfer the money.”

In response to the figures, the NECC has launched a campaign in collaboration with the National Crime Agency, City of London Police, UK Finance and Cifas to protect businesses from financial crime.

To learn more about Payment Diversion Fraud, please click here.

For help and advice with related matters, please get in touch with our team today.

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